BSY says there won't be hurdles to state's progress

Bengaluru: With Leader of the Opposition Siddaramaiah saying he was seeing ‘dark days’ for Karnataka while expressing concern over the states finances, Chief Minister B S Yediyurappa on Thursday vowed to raise more loans if required to fund developmental works.

Will get loan from World Bank you (Siddaramaiah) also have worked as the Chief Minister, I held discussions with World Bank and NABARD yesterday, let’s get (the loan)… and do developmental work. I know how to repay the loan, I will explain during my re-play, Yediyurappa said in the legislative assembly.

“It is my responsibility to see to that there are no hindrance to Karnataka’s development, I will do and show in three years,” he said.

The Chief Ministers’ statement came as Siddaramaiah, highlighting the financial condition of the Karnataka, asked where the money would come from for developmental works.

Cautioning that there would be revenue deficit situation in the coming days, he questioned that in such a situation from where would the money come for development which would come to a standstill as we would have money enough only for payment of salaries, repayment of loan and interest on it and other few things.

Noting that states committed expenditure has reached almost 90 per cent, he asked, how to get money or meet expenditure for developmental works where is the money to give for developmental works- for irrigation projects like Upper Krishna?

Participating in the discussion on state budget, Siddaramaiah further said he was seeing dark days ahead for Karnataka.

I’m seeing dark days for Karnataka. Because of demonetisation and GST the economic picture of the country also looks gloomy. So leaving aside party difference we all have to unite we will have to think about how to revive it, he said.

How to overcome the committed expenditure and bring it down, what we need to do to contain it at 70 per cent, how to bring down the revenue expenditure, how to stop from going to revenue deficit- we have to think and work on it, he added.

As Yediyurappa asked for suggestions, Siddaramaiah said tax collection has to be improved, all inefficiencies related to GST has to be set right, ill-effects of demonetisation have to be rectified, getting states share of funds from the Centre, and injustice to the state in allocation under 15th finance commission need to be corrected.

Fight it out with Centre, ask for justice from Union Finance Minister Nirmala Sitharaman, he said.

Siddaramaiah, in his speech, pointed at reduction in allocation to the state under the 15th finance commission, reduction in the state’s share in central taxes, stopping of GST compensation in the future, all these would lead to trouble in the days to come.

We are faced with reduction in devolution, also in grants next year, more than anything 15th finance commission understanding that few states like Karnataka has got less in devolution gave special grant. A sum of Rs 5,495 crore was recommended for Karnataka, but the Finance Minister Nirmala Sitharaman wrote to the commission questioning special grant- she represents state in Rajya Sabha, he said, and asked Yediyurappa government to get justice for the state.

Yediyurappa too in his budget speech earlier this month had said Karnataka is facing unprecedented economic difficulties following a Rs 8,887 crore reduction in the state’s share in central taxes, cut in allocation under 15th finance commission and a Rs 3,000-crore hit in GST compensation.

As per the interim report submitted by the 15th finance commission, there is a reduction in the state’s share of central taxes to 3.64 per cent compared to 4.71 per cent fixed by the 14th finance commission.

In view of this, there would be a reduction of Rs 11,215 crore in the state’s share of central taxes in 2020-21 budget, when compared to the previous one.